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MN egg producer to donate more than a million eggs as settlement

Sparboe Farms has decided to settle after the MN Attorney General's office accused them of price gouging during the pandemic.

WAYZATA, Minn. — A Litchfield-based egg producer, Sparboe Farms will be responsible for donating more than one million eggs to Minnesota nonprofits as a result of a settlement with the Minnesota Attorney General's Office.

This goes back to a lawsuit that was filed in Hennepin county earlier in September. The suit accuses Sparboe of price gouging during the height of the pandemic-induced food-buying frenzy...around March and April of last year.

This was during the period of peacetime emergency, and under the executive order 20-10, price gouging on essential items like food was illegal.

The suit alleges that Sparboe tripled its egg prices in March of 2020 and that it "did not increase its egg prices to recoup increased costs, rather, sought to take advantage of the increased demand for eggs due to the pandemic. 

Sparboe Farms fired back in a statement, saying that the lawsuit from the attorney general was flawed from the beginning.

The full statement reads:

"While the MN AG is praising himself with a win for consumers, his lawsuit against Sparboe was flawed from the beginning and a waste of taxpayers’ resources.  In the end, the AG did not obtain a civil penalty, damages, or any relief that would result in lower egg prices for consumers.

Sparboe has not, does not, and never will engage in the practices alleged by the Attorney General. Yet, it is important for us to resolve this in a positive way that will ultimately benefit Minnesotans.  Sparboe offered to donate eggs just as we have always donated as part of our ongoing charitable efforts. Egg donations are always needed, especially when Minnesotans are facing tremendous price increases in gas, electricity, and food overall.  In exchange for Sparboe’s commitment to donate eggs, the AG released all claims against Sparboe on behalf of the State of Minnesota, including all of its agencies and departments.

Many of the eggs found in Minnesota grocery stores are from large egg companies based in Iowa, Indiana, Pennsylvania, and Wisconsin. It is unclear why the Minnesota Attorney General’s office only pursued litigation with Minnesota-based family egg farmers. Equally unclear is why the Minnesota Attorney General sued the farmers and not the wholesalers, or retailers that actually set the prices to the consumer. It is not fair, just, or equitable that the AG would only go after Minnesota farmers, especially when those farmers were merely adhering to contractual pricing dictated by the large wholesalers.

Our donation settles the disagreement with the State of Minnesota with no admission of wrongdoing. We can now refocus on our mission which is feeding families and enriching lives by keeping Minnesota’s grocery shelves filled with eggs during the upcoming holiday season."

Sparboe denied all wrongdoing, and said "it has not, does not, and never will engage in practices alleged by the Attorney General."

The statement goes on to read that it is unclear why the AG's office did not sue the wholesalers or the retailers that "actually set the prices to the consumer."

If this all sounds familiar, this isn't the first time the AG's office has looked into price-gouging of eggs.

Back in April of 2020, a Howard Lake based egg producer Forsman Farms also settled with the AG's office...promising to limit its prices to no more than 20 percent over pre-emergency price.

According to the AG's office, it received and investigated 2,600 complaints of price gouging during the peacetime emergency.

Although price gouging is not outlawed at the federal level, many states have made it illegal during emergencies. Except the problem is, Minnesota is one of only 11 states without a law banning price-gouging. The executive order prohibiting that was just temporary.

Now going back to Sparboe, the company spokesperson said that they will be working with Second Harvest on how they can distribute more than one million eggs throughout the state of Minnesota. The donation apparently settles the disagreement with no admission of wrongdoing on part of Sparboe. The Consent Judgment filed with the county said Sparboe has 18 months to carry out this donation.